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Statement of accounts - year ended 31 March 2017
Minutes:
The committee considered a report of the Service Director - Finance seeking approval of the Statement of Accounts for the year ended 31 March 2017.
The Interim Head of Corporate Finance presented the report, highlighting the following:
a. The Statement of Accounts set out the Council’s financial position as at 31 March 2017 together with a summary of its income and expenditure for the 2016-17 financial year.
b. The audit of accounts had identified one significant change to the draft accounts relating to the valuation of the Council’s housing stock. This change, together with a number of agreed minor changes had been incorporated into the revised Statement of Accounts set out at Appendix 1. The original valuation used for the Council’s housing stock had been undertaken at 1 April 2016, not 31 March 2017. In previous years, the timing of this valuation had not been an issue. However, the significant upward movement in house prices in Bristol during 2016-17 had created a material error in the valuation. An upward revaluation had therefore been made and the accounts adjusted accordingly.
Main points raised/clarified/noted in discussion:
a. Page 54 - note 1 (adjustments include charges for PFI and for financing the capital programme and the transfer of the surplus on the HRA and the deficit on the General Fund): It was clarified that these were accounting adjustments made as part of the reconciliation of the financial outturn report.
(Note: Cllr Shah arrived at the meeting at this point, 2.32 p.m.)
b. Page 55 - It was clarified that the HRA income and expenditure statement showed a surplus of £4.8m for the year (the Council owned and managed
27, 198 homes).
c. Page 55 - It was clarified that that the £31m investment in schools buildings (to provide additional pupil capacity to meet increased demand for school places) was post-PFI funding, financed through the DfE Basic Needs allocation.
d. Page 80 - Reserves: It was noted that there was increasing pressure on reserves, with school reserves reduced substantially. This issue had been picked up in further detail in the period 4 budget monitoring report submitted to the Cabinet on 19 September and work was taking place with schools around this issue.
e. Page 97 - Avon Pension Fund: It was clarified that in May 2014, the Council had made a payment of £42m to the Avon Pension Fund in respect of the pension deficit for the period 2014-15, 2015-16 and 2016-17.
f. Page 108 - Remuneration costs: It was clarified that the remuneration figures included a significant number of employment severance payments.
g. Page 109 - External audit costs: It was clarified that the fees quoted accorded with the fees agreed at the outset of the financial year.
h. Page 133 - Council tax/debtor analysis: It was clarified that council tax income was increasing due to a growth in the council tax base and due to increased council tax levels. A range of appropriate measures were taken to recover debts owed in relation to council tax. As at 31 March 2017, local tax payers’ debt was £13,106,000 gross (net - £6,633,000), the overall expected council tax collection being approx. £190m. A fuller picture/analysis of the council tax debt in 2016-17 would be available by November. Consultation was taking place currently on the Council Tax Reduction Scheme for 2018-19.
i. Page 143 - Provisions - insurance fund: It was noted that valuation of “unique” assets (e.g. paintings/artefacts at the City Museum and Art Gallery) was carried out on a “fair” value basis, i.e. on the basis of the most likely, best value that could be obtained for that type of asset.
j. In relation to the revaluation of the Council housing stock, Cllr Stevens drew attention to the fact that this effectively meant that the average value of a council home was in the region of £60-70,000. It was noted that the valuation represented a considered fair value taking account of liabilities, including tenant right to buy. Finance officers agreed to supply a briefing note on this issue to Cllr Stevens.
k. Page 81 - Cllr Pearce raised an issue about the detail of how valuation decisions on investment properties were made and assessed/kept under review. Finance officers agreed to supply a briefing note on this issue to Cllr Pearce.
Noting and taking account of the above, the committee
RESOLVED (unanimously, all 7 committee members voting in favour, and none against)
That the Statement of Accounts for the year ended 31 March 2017 be approved.
Supporting documents:
- 8.1 - Statement of accounts - year ended 31 March 2017, item 112. PDF 222 KB
- 8.2 - Appendix 1 - Statement of Accounts 2016-17, item 112. PDF 7 MB
- 8.3 - Appendix 2 - Letter of representation, item 112. PDF 64 KB